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Under attack in parliament, Steinhoff execs say they are trying to save the company

Sep 04 2019 17:43
Khulekani Magubane, Fin24

Steinhoff executives were under fire in Parliament on Wednesday for not giving the Hawks the final PwC report - but defended themselves by saying they are protecting the rights of shareholders.  

Steinhoff chair Heather Sonn and group CEO Louis du Preez briefed a joint meeting of Parliament's Standing Committee on Finance, Standing Committee on Public Accounts, Portfolio Committee on Public Service and Administration and Portfolio Committee on Police on the latest at the company.

At the heart of the scandal is former CEO Markus Jooste and allegations of insider trading, cooking financial books and dodging taxes, all of which caused the company's share price to crash and wiped out R20bn in investments from public pensions.

MPs gave Steinhoff executives a grilling, especially when they found out that the Directorate of Priority Police Investigations (the Hawks) still did not receive the final PwC report into the circumstances of the Steinhoff scandal, despite a commitment from Steinhoff that they would provide it.

Sonn said the Hawks were "granted access" to the report and that Steinhoff was informed that all the documents the Hawks and the National Prosecuting Authority had were "satisfactory" for an investigation to take place.

When MPs charged Steinhoff with trying to avoid transparency and accountability, Sonn denied this saying the company was "protecting the interests of shareholders of the companies while allowing the criminal prosecutorial processes to take place".

She said many details pertaining to the company were privileged and would prejudice shareholders and investigations in other jurisdictions where Steinhoff has a presence. Du Preez said Steinhoff had to consider matters such as data privacy laws in Germany and different legal suits.

"There is no benefit, financially or otherwise, to not cooperate with the authorities for Steinhoff. We must either save this group or liquidate it. We have taken the decision to save the group and to do that we must consider the interests of many stakeholders in many jurisdictions," said Du Preez.

Inkatha Freedom Party MP Mkhuleko Hlengwa said: "At every meeting Steinhoff has insisted that they are cooperating. But what is not in dispute is that the Hawks are frustrated and that is not ideal".

Sonn told the members of Parliament that Steinhoff had to keep the company on track for stability so that investors and shareholders can extract some value and, hopefully, recover some of what was lost.

"We need to have a structured restructuring process so that we can maintain control of the company, go through asset discovery, repay debt and manage to stay in control of the company through that process," said Sonn.

steinhoff  |  fsca  |  pwc  |  hawks  |  parliament


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